Preparing for EU CBAM: A Guide for Thai Exporters

If you are a Thai exporter selling goods into Europe, especially steel, aluminium, cement, or fertilizers, there is one policy you need to pay attention to now.

Since January 1, 2026, the European Union's Carbon Border Adjustment Mechanism (CBAM) has entered its definitive phase, and it directly affects carbon-intensive goods exported to the EU.

For many businesses, this may sound like another distant regulation. In practice, it is already changing the cost structure and competitiveness of exports into the European market.

Key Takeaway: The EU's Carbon Border Adjustment Mechanism (CBAM) entered its definitive phase on January 1, 2026. Thai exporters of steel, aluminium, cement, and fertilizers must now provide verified emissions data to EU importers. Estimated impact: 28 billion baht or roughly 3.8% of Thai exports to the EU.

What is CBAM?

CBAM is short for Carbon Border Adjustment Mechanism. It is the EU's way of making sure imported goods face a carbon cost similar to goods produced inside Europe.

Here is the basic idea. Many manufacturers in the EU already pay carbon costs through the EU Emissions Trading System. If imported goods come from countries without an equivalent carbon pricing mechanism, those imports could gain an unfair cost advantage.

CBAM is designed to close that gap. Under the system, EU importers must purchase carbon certificates for covered imports. The price of those certificates mirrors the EU ETS price, which is currently often discussed in the range of EUR70-90 per tonne of CO2.

Even though the importer in Europe is the one buying the certificates, the burden does not stop there. EU importers need emissions data from manufacturers, and the added cost can directly affect how attractive Thai products look compared with lower-carbon alternatives.

Key Dates

• Now (2026): Definitive phase begins, with annual reporting and certificate purchases required
• February 2027: First certificate sales for 2026 imports
• September 2027: First annual declaration deadline
• 2034: Full implementation, with 100% of emissions covered

In other words, this is no longer a regulation that exporters can wait and watch from the sidelines. Once EU customers need to file real declarations, they will immediately begin requesting real plant-level emissions data from their suppliers.

Impact on Thai Exports

CBAM is estimated to affect Thai exports by around 28 billion baht, equivalent to about 3.8% of Thailand's exports to the EU.

The sector-level picture looks roughly like this:

There is also growing expectation that CBAM could expand further in the coming years. Plastics, polymers, chemicals, and glass are often mentioned as likely additions by around 2030.

So even if your product is not under the strongest pressure today, it does not mean it will stay outside the scope forever.

What Thai Exporters Must Do

From a practical point of view, Thai exporters should start with four priorities:

1. Measure your emissions
   Track both direct emissions from production and indirect emissions from electricity use. At least 80% of the data should come from actual measurements rather than default values.

2. Share data with EU importers
   Importers need your emissions data to complete their CBAM declarations. If you cannot provide it, they will struggle to report accurately and may become more cautious about sourcing from you.

3. Get verified
   From 2026 onward, actual emissions data needs to be verified by EU-accredited verifiers if it is to be used in the formal system.

4. Register with the EU CBAM Registry
   Non-EU operators can upload installation data directly, so exporters should understand what information is required and prepare supporting documents early.

Warning: If you do not provide actual emissions data, EU importers must use default values instead. Those defaults are usually higher than real emissions, which raises their costs and makes your products less competitive.

Action Checklist

Before full compliance becomes urgent, it is worth getting the basics in place:

• Check whether your products are covered by CBAM using EU CN codes
• Contact TGO for carbon footprint certification support
• Set up emissions measurement and reporting systems (MRV)
• Coordinate with your EU customers on what data they need and in what format
• Explore decarbonization options such as renewable energy or EAF technology
• Train your sustainability, operations, and export teams

If you want to understand the product carbon footprint process in more detail, you can read How to calculate a Product's Carbon Footprint?

If you are still deciding whether to begin at the organizational level or the product level, this article may help: Should Your Business Start with CFO or CFP?

The Opportunity

CBAM is not only a compliance burden. It can also create a competitive opening for suppliers that are ready earlier than others.

Thai steel exports to the EU rose 250% year-on-year during January-October 2025, partly because European buyers were already looking for suppliers with lower-carbon products and better emissions transparency.

For Thai producers, especially those with lower-carbon production routes such as EAF-based steelmaking, that can translate into a meaningful advantage. Some estimates suggest Thai EAF steel producers could reduce EU buyer costs by around 5-10% compared with higher-carbon competitors.

The signal is clear: in a market where carbon data matters more every year, exporters that can measure, verify, and communicate their emissions well may turn compliance into commercial advantage.

Thailand's Climate Change Act

Another important development is Thailand's Climate Change Act, approved in December 2025, which introduces a carbon tax and an emissions trading system.

The key potential benefit is that carbon prices paid in Thailand may eventually be deductible from EU CBAM obligations. If that happens in practice, it could reduce the total cost burden for Thai exporters selling into Europe.

That means preparing for carbon pricing in Thailand may help not only with local compliance, but also with export competitiveness abroad.

Resources

• TGO (Thailand Greenhouse Gas Management Organization): www.tgo.or.th
• EU CBAM information: taxation-customs.ec.europa.eu
• Federation of Thai Industries: industry-specific guidance
• Department of Trade Negotiations: CBAM coordination support

Bottom Line

CBAM is a structural change in global trade, not a temporary rule that exporters can ignore. The businesses that move first on measurement, reporting, and verification will usually have more options than those that wait.

For Thai exporters, the priority now is simple: start measuring, start reporting, and use compliance as a way to strengthen long-term competitiveness in the EU market.

If you want to start measuring your product carbon footprint and prepare your data for European market requirements, you can learn more or book a demo with picarbon at https://picarbon.co.th/book

Data sources: Kasikorn Research Center, Federation of Thai Industries, and the European Commission. This guide provides general information based on materials referenced as of February 2026.